National Retirement Security Week - Hustler Daily Thumbs Up - Oct 15

Hello fellow Encore Hustlers

Did you know that the week of October 20 - 26 was National Retirement Security Week?

Back in 2006 U.S. Senators Gordon Smith and Kent Conrad introduced a resolution to raise awareness of the importance of retirement savings and to encourage contributing toward retirement plans.

Check out this story from the Houston Chronicle about why Americans need to save more toward retirement.  However the article doesn't provide much advice what to do if you are like many Americans who cannot afford to save for retirement.  What's the point of having access to a 401k or an IRA if your budget has no room to fund a retirement plan.  Unfortunately too many of us no cushion and we are stuck between a rock and a hard place.

The article would have been better if it suggested turning to side hustles to earn extra cash that could be earmarked for retirement savings.  It also did not consider working part time in retirement to close the gap between expenses and retirement savings and Social Security benefits.

Mr EH agrees that it can be a bitter pill but it's better to face the facts and start your side hustle as soon as possible.

Cheers,
Mr EH

Stash your cash in a SEP - Hustler Daily Thumbs Up - June 16

Hello fellow Encore Hustlers

If you have an encore hustle that classifies you as an independent sole proprietor business owner then you should read this article from Bankrate.com about the advantages of setting up your own SEP IRA.

A SEP IRA stands for Simplified Employee Pension Individual Retirement Account.  This allows you to shelter 25% of your business earnings or $56,000 of business income, whichever is less.  The SEP IRA is independent of any participation in other retirement shelters.  For example this business is a side hustle and you are also still working for another employer who has a 401k program, then you can also contribute up to the maximum that you are allowed in the 401k.  You can also contribute to either a traditional IRA or Roth IRA.

So if your side hustle is successful and you are in a position not to need the income to cover to immediate needs the SEP IRA might be right for you.

Cheers,
Mr. EH

The Hustle High Five - Hustler News of the Week - March 16

Hello fellow EncoreHustlers.

I hope these weekly posts inspire you toward you starting your encore career or continuing your side hustle.  If you do not have a encorehustle I am sure you know someone who does.  Without further ado here are this weeks high five.

1)   Public sector employees often have pension plans that the envy of the private sector workforce.   The Dallas Police and Fire Pension System has a sweet perk called the Deferred Retirement Option (DROP) that guaranteed their members a minimum 8% return if they continued to work past retirement age.  However this generous benefit has stressed the sustainability of the pension plan and the Texas Supreme Court has handed down a decision that allows the benefits to be dropped (sorry for the pun) to 5%.

2)   The US has IRA's and Canada has RRSP's.  New Zealand's version is KiwiSaver and in recognition of an older workforce the fund now allows workers over age 65 to start contributing to the plan.  Previously one had to be enrolled in the plan before age 65.

3)   Here is a great analysis of pensions and retirement from an Asian perspective.  How retirement is funded across Asia varies from nation to nation.  China has traditionally gone with the Defined Benefit (DB) model that has the state or company fund the pension.  Singapore, Indonesia and Malaysia follows the Defined Contribution (DC) model that relies heavily on worker contributions and more risk taking, similar to the US 401(k) model.  Like the Baby Boomer generation in the US, Asia also has a tidal wave of aging and it will have significant effects across the globe, involving billions of people and trillions of dollars.  Retirement age in Asia is rising and millions of retirees are continuing to work to make up for the shortfalls in their pension payments.

4)   Following your passion is often cited as a major contributor to both successful careers and to successful retirements.  In the case of Mary Knox-Johnson, she has used this advice for her encore career.  After 32 years of teaching high school English, speech, and theatre in North Dakota, she took a retirement gap year to visit relatives, swim with dolphins and write a book.  With that done she became an adjunct professor teaching speech at Bemidji State University (Minnesota) and a director at the Community Theatre.

5)   From Canada here is a great story about two seniors who have no plans to retire ever. Brian Dickens a commercial fisherman from British Columbia is refitting his boat to allow him to extend his fishing range to the open ocean.  David Morrison, a Toronto business executive, is launching an app called FOOi, a digital app for peer-to-peer and peer-to-business financial transactions.

Have a great week and I would really appreciate you sharing this post.

Cheers
M. EH